GOP embraces showdown over oil pipeline, tax cuts

Sensing a political opening, congressional Republicans are moving toward a high-stakes showdown with President Barack Obama over a plan to link fast-tracked approval of an oil pipeline to a measure renewing a payroll tax cut.

WASHINGTON — Sensing a political opening, congressional Republicans are moving toward a high-stakes showdown with President Barack Obama over a plan to link fast-tracked approval of an oil pipeline to a measure renewing a payroll tax cut.

Senate Minority Leader Mitch McConnell, R-Ky., said the proposed Keystone XL pipeline from Canada to Texas will help the president achieve his top priority — creating jobs — without costing a dime of taxpayer money.

"There is no reason this legislation shouldn't have the president's enthusiastic support," McConnell said Monday on the Senate floor. "The only reason for Democrats to oppose this job-creating bill would be to gain some political advantage at a time when every one of them says job creation is a top priority."

The State Department said last month it was postponing a decision on the pipeline until after next year's election. Officials said the delay is needed to study routes that avoid environmentally sensitive areas of Nebraska.

The GOP language would require approval of the pipeline within two months unless Obama declares it is not in the national interest.

The State Department warned Monday the congressional interference in the approval process would likely lead to a rejection of the pipeline. The State Department has authority over the project because it crosses an international border.

"Should Congress impose an arbitrary deadline for the permit decision, its actions would not only compromise the process, it would prohibit the department from acting consistently with National Environmental Policy Act requirements by not allowing sufficient time" for the project to be considered, the State Department said in a statement.

In that case, "the department would be unable to make a determination to issue a permit for this project," the statement added.

McConnell and other Republicans dismiss such procedural objections.

"The only thing arbitrary about this decision is the decision by the president to say, 'Well, let's wait until after the next election,'" said House Speaker John Boehner, R-Ohio.

Boehner and other Republicans say many Democrats support the pipeline, noting that 47 House Democrats voted in a favor a bill this summer to speed up the permitting process. GOP lawmakers say the White House opposes the pipeline provision in the tax bill so Democrats can gain political advantage by blaming Republicans for defeating the popular payroll tax cut. The tax bill is expected on the House floor Tuesday.

The two parties generally agree on the bill's fundamentals: preventing the Jan. 1 expiration of payroll tax cuts and extending coverage for the long-term unemployed. Obama has said he will reject the overall bill if it includes language speeding up approval of the Keystone XL pipeline, which would carry oil from western Canada to refineries in Texas.

Obama's threat has increased conservative support for the overall measure, with Republicans hoping to use Obama's opposition to portray him as favoring environmentalists over jobs.

Rep. Lee Terry, R-Neb., called the Keystone XL project crucial to getting thousands of people back to work.

"This is an important jobs and energy security bill which just makes plain sense," said Terry, author of the pipeline provision. "The American people want us to stop buying Venezuelan oil. The Keystone pipeline is a key component to making that happen."

Environmental groups, who celebrated the administration's announcement of a delay in the Keystone project last month, accused Republicans of forcing a premature judgment on the pipeline in order to curry favor with the oil industry.

"To get their way, House Republicans — with some support in the Senate — are even willing to block the much-needed extension of the middle-class tax cut," said Suzanne Struglinski of the Natural Resources Defense Council, an environmental group.

Struglinski called the pipeline push a "fool's errand" because of Obama's threat to reject the measure, and said its likely inclusion in the House bill showed that House leaders have embraced the "extreme agenda" pushed by the tea party.

Senate Majority Leader Harry Reid, D-Nev., said last week that House leaders were wasting time, because the Keystone provision will not pass the Democratic-controlled Senate.

The State Department decided last month to delay the project until 2013, to allow the project's developer to figure out a way around Nebraska's Sandhills, an ecologically sensitive region that includes an aquifer that supplies water to eight states.